Enhancing the Dynamics of Belarusian Export Activities

In early April, the "2024: Railway Logistics - Addressing Current Development Challenges" conference took place.

The primary focus of the meeting was to coordinate the collaborative efforts of railway administrations in the 1520 area and allied nations to enhance foreign trade and boost its capacity.

The conference was attended by representatives from the railway administrations of Belarus, Russia, Kazakhstan, Kyrgyzstan, Turkmenistan, Azerbaijan, China, and Uzbekistan, as well as logistics and forwarding companies, and major shippers.

The event aims to enhance the export activities of Belarusian companies through the utilization of railway transport and the efficient exploitation of the transport and transit capabilities of the railway. The participants also concentrated on addressing challenges in cargo transportation under new conditions along alternative routes, assessing infrastructure readiness to support the smooth flow of increasing goods volumes, and developing efficient transport and logistics strategies for delivering products from Belarusian companies to the EAEU market and to "far arc" countries.

"During last year's conference, we formulated suitable logistics solutions that enable us to deliver top-notch transport services to the government and businesses. Today, we are already operating in new conditions and effectively putting them into practice. "This was made possible solely through a collaborative, coordinated approach to resolving issues while maintaining a balance of interests among all stakeholders in the transport and logistics market," stated Vladimir Morozov, Head of the Belarusian Railway (BDZ), as he inaugurated the conference.

In support of these statements, the First Deputy Head of Belarusian Railways, Peter Dulub, briefed the meeting participants on the cargo volumes transported by Belarusian railways in 2023. He stated that the proportion of freight traffic handled by Belarusian Railways with the Eurasian Economic Union countries and the People's Republic of China exceeded 90% of the overall international traffic volume and rose by 10% from 2022. By the end of 2023, the volume of exports reached 72.6 million tons, marking a 15.6% growth compared to 2022.

He mentioned that conditions have been established for transporting Belarusian goods through Russian ports, overland routes to China and Asian nations, and via the North-South transport corridor to India, Iran, and the Persian Gulf countries.

JSC Russian Railways is the most crucial strategic partner for the Belarusian Railway. Alexander Khatianov, First Deputy Head of the company's Corporate Transport Service Center, discussed the outcomes of collaborative efforts, logistics project advancements, and infrastructure upgrades focused on enhancing the transportation volume of Belarusian export goods.

According to Russian Railways, transportation involving BDZ and Russian Railways rose by 7.6% by the end of 2023, aligning with the growth trend of 2022. The transportation of goods in bilateral communication surged by 34%, while transit traffic with the Republic of Belarus doubled, with over 70% of transit through Russian railways heading towards the ports in the North-West of the Russian Federation, marking a 2.5-fold increase by the end of the previous year.

Peter Dulub also highlighted the rise in shipments of container trains carrying Belarusian products to China. For example, 151 container trains were dispatched on the Belarus-China route in 2021, last year saw over 1.5 thousand trains. The plans for the current year also indicate a promising path forward.

"The republic requires 150-170 container trains monthly, but we are currently restricting cargo owners due to insufficient infrastructure capacity," stated Vladimir Morozov.

Peter Dulub stated that the transportation growth does not completely align with the requirements of Belarusian exporters and the nation as a whole; the demands and objectives are significantly greater. It is essential to ensure stable transportation for Belarusian shippers to accommodate the growing volumes of goods along current routes.

To boost transportation volume, BZD is methodically developing and implementing regulatory legal documents, expanding its rolling stock fleet, and utilizing private wagons for export loading.

Moreover, in August last year, to meet the growing demands for exporting Belarusian products, Belarusian Railways and JSC Russian Railways inked a deal for the modernization and enhancement of the railway infrastructure of the 9th transport corridor leading to the ports in the North-West of the Russian Federation. As per the document, the Russian side is tasked with constructing seven sidings at the Oktyabrskaya Railway polygon, upgrading communication networks on the Luga - Batetskaya segment, and enhancing railway connections to the Bronka port.

"As for the connections to Bronka, preparation of the construction site has been underway since September of last year. Presently, the main focus is handling the documentation and securing permits required to demolish urban and private structures to facilitate construction and installation activities," stated Alexander Khatianov.  

He also emphasized the significance of developing and utilizing all alternative transportation solutions, with a primary focus on the North-South International Transport Corridor (ITC). Last year, around 700 thousand tons of cargo were transported from Belarus, primarily through the western route, via the ITC.

"It is essential to enhance transportation along the other two branches of the corridor. Uniform tariff rates are currently in effect for Belarusian shippers when transporting goods in containers along the eastern branch of the ITC throughout the entire route," noted Alexander Khatianov.

Besides, to boost traffic flow along the North–South ITC, regulatory and technological documentation for rolling stock in this corridor was coordinated and approved within the Council for Railway Transport of the Commonwealth member States, as highlighted by Sergey Solozhenkin, Deputy Chairman of the Directorate of the Council for Railway Transport of the Commonwealth member States.

"The council has expanded with Iran and Afghanistan railway administrations joining as associate members, enabling a more comprehensive consideration of cooperation in the North–South ITC regions," he added.

Alexander Khatianov mentioned that the adoption of digital technologies and digitalization in transportation planning can positively impact the increase in transported goods volume. Both Russian Railways and BZD currently have their own software products; it is essential to synchronize them and establish a unified digital platform.

At present, there is a discussion underway regarding the organization of transportation to Iran via the eastern route of the North–South corridor, with Kazakhstan Railways playing a crucial role. Darkhan Muratkhanov, Director of the Marketing and Service Development Department of JSC KTZ – Cargo Transportation, emphasized that the eastern route of the North–South ITC is the ideal pathway for transporting Belarusian export goods to Iran and further to India and the Persian Gulf nations.

The national company Kazakhstan Temir Zholy, in collaboration with the railway administrations of Russia, Turkmenistan, and Iran, is actively involved in developing the North-South transport corridor. To enhance the corridor's capacity, efforts are underway to boost the efficiency of interstate junction points. Competitive tariffs for container and wagon transportation have been established," he stated.

Darkhan Muratkhanov highlighted ongoing significant infrastructure initiatives aimed at boosting transit and transport capabilities. These projects encompass the construction of the Darbaza – Maktaaral segment leading to the Uzbekistan border, which will alleviate congestion at the Saryagash station en route to Central Asia. On top of that, the addition of second tracks on the Dostyk – Moynty segment is expected to increase capacity more than fivefold. Other key developments include the construction of the Ayagoz – Bakhty railway line and the establishment of a third border crossing with China.

In turn, Deputy Chief Engineer of the Chinese Railways State Corporation and Head of the International Cooperation Department, Ju Guojiang, mentioned that Chinese Railways is expediting efforts to establish a modern logistics system in alignment with the plan of the Government of the People's Republic of China. This initiative leverages the unified management of the national railway network and its pivotal role in the national integrated transport system. In 2022-2023, nearly 4 billion tons of cargo were transported by Chinese railways, achieving another historical record and sustaining a seven-year trend of traffic growth. Chinese Railways leads globally in key metrics such as transportation volumes and cargo turnover.

Considering the evolving demands of modern logistics, Chinese Railways has formulated a comprehensive system product for transporting goods along the High-Speed Rail (HSR) at 250 km/h and regular trains at speeds ranging from 160 km/h to 80-90 km/h. As a result, a logistics network for high-speed cargo transportation across the country has been gradually established. Within 500 km, goods are delivered in one day; within 1,000 km, in two days; within 2,000 km, in three days. The 95306 cargo online platform is developing functions to offer services 24/7. The entire transportation process is undergoing digitalization.

Three main corridors have been established for container train transportation in the China-Europe connection, spanning western, central, and eastern China. In recent years, efforts have been made to modernize the Alashankou border station in Manchuria, increase capacity at the approaches, and construct second tracks on the Jinghe-Alashankou section. The opening of traffic through the Nizhneleninskoye-Tongjiang border crossing has significantly enhanced throughput and transportation capacity at border crossings to meet the increasing international communication needs.

Alexey Grom, General Director of UTLC ERA, discussed current global container turnover trends in his speech. "The global container traffic volume in 2023 reached nearly 130 million TEU. In 2023, over 75% (nearly 100 million containers) were transported in connection with Eurasia. Experts anticipate an average annual growth of 3.4% (3.5 million TEU) over the next 3-4 years. If we convert this volume into trains, it equates to an extra 100 container trains per day. Of course, maritime transport remains predominant. However, in my opinion, a scenario where railways will contribute to this increase in container traffic is not far-fetched. When considering the Eurasian transit railway routes, which include the routes of UTLC ERA via the infrastructure of Kazakhstan, Belarus, and the Russian Federation, as a reference point, we have seen this share grow to 3.1% in recent years, nearly doubling within a year," he remarked.

According to Alexey Grom, UTLC ERA's goal remains unchanged – to reach a transportation volume of 1 million containers. The company's transportation volumes over the past three years have averaged approximately 700,000 TEU annually.

"On the China – Europe – China railway routes, 9 out of 10 containers are transported by our company," stated Alexey Grom, General Director of UTLC ERA JSC.